Ambuja Cement net profit up 35% at Rs 469 cr in June quarter

Q2 net profit up 35% at Rs 469 crore on year-on-year basis

Ambuja Cement today reported 35% growth in net profit at Rs 469 crore for the quarter ended June 30 on increased sales.

The company had posted net profit of Rs 348 crore in the corresponding period last year.

Net sales of the company rose 17.9% to Rs 2,566 crore during the April-June quarter from Rs 2,176 crore in the year-ago period. This is on account of 7.3% rise in sales volume at 6.54 million tonnes, Ambuja Cement said in a statement.

Competition Commission of India has recently imposed Rs 1,163.91 crore penalty on Ambuja Cement, controlled by Swiss major Holcim, for its alleged involvement in price cartel.

Meanwhile, during the quarter, absolute EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation) of the company rose by 22.8% to Rs 735 crore. Ambuja Cement, however, said higher operational expenses took away the rise in realisation.

"Increase in realisation was barely sufficient to make up for cost increase. The profit margin still improved due to higher sales volumes and improved operational efficiencies," Ambuja Cement said.

Total expenses, including raw material and power costs, rose to Rs 1,965 crore during the April-June quarter from Rs 1,698 crore a year ago.

Ambuja Cement expects profit margins are likely to remain under pressure due to steep rise in cost driven by higher raw material prices and rise in distribution and freight costs.

"Ambuaj Cement would continue its thrust in improving productivity and operational efficiency to partly mitigate these pressures. Cement demand is expected to be low during the monsoon," it added.

Shares of the company today settled at Rs 179.30 apiece on the BSE, up 3.05% over the previous closing.